How to…provide a people-centred alternative to the social fund

The devolution of the social fund is an opportunity for local areas to pool their resources and provide funding and support systems for the long-term resilience of residents, as Nicola Steuer explains.

I work in Islington, a north London borough with a population of 206,000. Islington is well known, among other things, for its former resident Tony Blair, for its trendy bars, restaurants and shops, and for its internationally renowned arts venues such as Sadler’s Wells and the Almeida Theatre.

It is perhaps less well known for being the place with the shortest life expectancy for men in London. It has the 2nd highest rate of child poverty in London, after Tower Hamlets, and the 4th highest rate in England. Here 18,000 people have no formal qualifications, and 13,000 people have unsecured debts exceeding £15,000. The stories behind the statistics show that social isolation blights many people’s lives.

For places like Islington sweeping changes to welfare provision coupled with budgetary cuts to local services will have a tangible and potentially devastating effect on the lives of individuals, families and communities. As an organisation which aims to promote social change in the borough of Islington, and provides grant funding to individuals and organisations to help achieve this, here at Cripplegate Foundation we have been following the welfare reform agenda with interest.

One of many significant changes to the welfare system in 2013 is the abolition of the discretionary elements of the social fund. This national fund provides a system of community care grants and interest free loans for people on low incomes, in crisis, or at turning points in their lives. From April 2013 the Department for Work and Pensions (DWP) will devolve budgets to each local authority to administer a discretionary system of grants and crisis loans for residents in need. The money formerly spent in local areas on delivering this support will not be ring-fenced.

This change to the social fund concerns us for two reasons. First, and most importantly, because of its potential consequences for Islington residents who require support. Second, for the more practical reason that applications to our Foundation’s grants to residents programme rely on people first applying to the social fund for support, with Foundation grants providing an alternative or additional source of support. With a change in how the social fund is provided and with the most significant shift taking place in the welfare state since its inception, real challenges are posed to the charitable funding sector in deciding what its future role should be. The question for us was how should we, as a Foundation, best respond?

We set up a small social fund working party in spring 2012 to explore this question. The group developed and reviewed a range of options, from stopping grant funding individuals entirely to continuing the grants programme ‘as is’ but without the requirement for applicants to apply for state support first. We also starting talking to others about their plans. This included other grant making trusts and foundations, the local voluntary sector, and Islington Council. Taking the individual resident as our starting point, we were particularly keen to explore what would most benefit them.

The result is a new resident support scheme (RSS) which will be in operation in Islington from 2nd April 2013. This is a partnership initiative between Islington Council and Cripplegate Foundation. The scheme will provide financial assistance to low income residents to, for example, purchase essential household items, address a shortfall in rent caused by the ‘bedroom tax’, or help with living expenses for those affected by crisis or disaster. It will target those at risk as well as in need and will prioritise:

  • those at risk of homelessness, including tenancy at risk
  • those where there is a risk to family stability, including domestic violence
  • those where there is a risk to health or independent living

The RSS is not only about giving a grant to provide short term financial assistance. The aim of the scheme is to enable Islington residents to build their resilience so that they can sustain their home, health, family and security, and improve their long-term circumstances.

One of the principles partners have worked towards in designing the scheme is that of ‘integration’ i.e. the scheme aims to bring together different funding streams and local opportunities to support residents. The Child Poverty Action Group has referred to this as a way to ‘hide the wiring’ from the residents’ perspective so that wherever they enter the system, whether through a statutory support service (e.g. housing), through a voluntary sector support worker or through applying ‘direct’ for a social fund type payment, their eligibility for the full range of support is determined.

The result is that the resident support scheme brings together four different funding streams to create a fund of just under £3m made up of:

  • Discretionary housing payments
  • Payments previously made through the social fund by DWP. Islington Council has agreed to ringfence the full amount previously awarded to Islington residents for the RSS
  • Islington Council’s new welfare provision for council tax relief in exceptional circumstances
  • Cripplegate Foundation’s former grants to resident’s scheme

Applicants need only apply once to be considered for all grants and services. In addition to providing grants, an integral feature of the scheme is that it will offer residents other forms of support to help improve their circumstances in both the short term and long term. This will fall into three broad areas:

  • MONEY AND INCOME: everyone accessing the scheme will receive an automatic benefits check. Residents will also be supported with money advice and specialist help with fuel debts.
  • EMPLOYMENT AND TRAINING: if relevant, residents will be offered, advice on courses, volunteering opportunities, and CV preparation.
  • SOCIAL WELLBEING: where relevant, support will be provided to help reduce social isolation, enable community involvement, and build residents’ capabilities.

This system of support is dependent on local voluntary and community organisations participating in the scheme. Rather than simply provide a telephone number for an individual applicant to access follow-up support, the scheme has been designed so that referrals are made direct to the organisation. The responsibility is for the organisation to then follow up with the resident. Similarly, Cripplegate Foundation’s knowledge of voluntary and community organisations in the borough, built from visiting every organisation which applies for grant funding, will be used to ensure the scheme achieves ‘additionality’ and provides opportunities for local residents.

Some of the main operational features of the scheme are as follows.

There will be number of access points for the new scheme:

  • COUNCIL STATUTORY SERVICES – e.g. housing, social services. These services will be allocated a notional budget which they will manage. This route is only for people already in contact with these services.
  • VOLUNTARY SECTOR ‘RECOMMENDER’ PARTNERS – a number of voluntary organisations will hold notional budgets which they will manage.
  • ‘REFFERAL’ PARTNERS – This includes council teams (such as the customer service centre) and voluntary sector organisations (such as local advice agencies) who will be able to make applications on behalf of residents. This provides universal access to the scheme and allows for a resident to apply ‘directly’.

Applicants who cannot easily access the RSS because of disability or frailty will be offered a home visit.

A central administration team of seven people will verify and process applications. Based in financial operations in the council, the team will include a seconded member of staff from Cripplegate Foundation.

The RSS will operate an online system of applications and payment. New software has been developed for this purpose and a training programme is underway with local organisations. Payment will be made largely by card through electronic payment cards for goods. These closely resemble debit or credit cards and will ensue that there is no stigma attached to their use while allowing individuals choice over the items they purchase.

From the autumn of 2013 the scheme will offer applicants second hand or re-used goods as an alternative to new goods. This will enable applicants (who choose this option) to get more furniture for the same amount of money they would otherwise be given for new goods.

Changes to the social fund are just one of many reforms being introduced following the welfare reform act 2012. The replacement of council tax benefit with new local schemes, the benefit cap, the ‘bedroom tax’, the replacement of disability living allowance by personal independence payments, universal credit, and more, will all be introduced this year. Although devolution of the social fund is only one element of a broader reform agenda, getting effective shared approaches to providing grants and loans is vital to create fairer and more efficient systems of support by targeting spend to those who need it most. This challenges the charitable funding sector to think and act differently, and for new forms of collaboration to emerge within the statutory and voluntary sectors.

This challenges the charitable funding sector to think and act differently, and for new forms of collaboration to emerge within the statutory and voluntary sectors

New Start has recently featured a number of articles on the need for people-centred action and responses to the current policy climate. In Islington we aim to do exactly that. We are not seeking to replicate the social fund at a local level. This is about grasping an opportunity to support people in a relational, rather than transactional, way and providing more effective, meaningful support as a result.

Of course planning a new scheme is one thing, delivering it in a way which improves peoples’ lives is quite another. It is as yet untested and there are risks. We know this and we will be tracking its progress and adapting the scheme as it evolves. But by taking these risks our hope is that we create opportunities for people, as well as addressing their needs, and in so doing achieve long term change for Islington residents.


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11 years ago

Hi Nicola
Although our geographies and challenges are different, here in Northumberland we have gone down a similar route and commissioned a partnership of three third sector organisations to deliver the Discretionary Social Fund. Our scheme is Northumberland Emergency Transition Support (NETs). It involves:
– a debt advice charity DAWN who has expertise in running national telephone debt advice and previous legal aid support (so this contract helps maintain skilled VCS workforce now the Legal Aid funding is withdrawn from April). They will provide the front end of the process and triage clients;
– Five Lamps who deliver an integrated range of social, economic and financial inclusion services, will do the assessments and process loans and grants
– Voices, a social enterprise that delivers support to children, families and young people and also work in partnership to provide a strategic approach to support services across Northumberland.
It would be good to have a conversation at some point regarding your scheme and what we could learn from each other

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